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Comparative income statement data for Carla Vista Inc. and Martinez Ltd., two competitors, are shown...

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Accounting

Comparative income statement data for Carla Vista Inc. and Martinez Ltd., two competitors, are shown below for the year ended December 31, 2021.

Carla Vista Martinez
Net sales $1,920,000 $563,000
Cost of goods sold 1,102,080 356,942
Gross profit 817,920 206,058
Operating expenses 556,800 87,828
Profit from operations 261,120 118,230
Interest expense 6,960 1,252
Profit before income tax 254,160 116,978
Income tax expense 76,248 29,245
Profit $177,912 $87,733

Additional information:
Average total assets $894,000 $250,563
Average total shareholders equity 751,000 212,808

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Solve

1) Using vertical analysis, calculate the percentage of the base amount of the income statement for each company. (Round answers to 1 decimal place, e.g. 12.5%.)

2) Calculate the gross profit margin, profit margin, asset turnover, return on assets, and return on equity ratios for 2021 for each company. (Round answers to 1 decimal place, e.g. 12.5 or 12.5%.)

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